The greenback clawed back some ground at the start of this week as US economic data surprised to the upside. This development raises the possibility of the Fed being pushed into more aggressive hikes in the near term to combat the persistently high inflation across America. Yesterday’s data saw services ISM numbers smash expectations and renew concern that rates will need to be higher to ensure tackle the resilience of the economy.
The US dollar gained ground against its peers in the wake of this data. After trading above $1.23 earlier in the session the GBPUSD fell to the $1.21s while EURUSD dropped below the key $1.05 mark.
Overnight the Reserve Bank of Australia has increased rates up to 3.10%. This saw them opt for a 25-basis point increase. The European and US trading sessions will be quiet on the data front. German factory orders will highlight the session.
Written by Viv Savani. 6:54am, December 6th 2022
The details expressed in this market report are for information purposes only and are not intended as a solicitation for funds or a recommendation to trade. Cornhill International Payments limited accepts no liability whatsoever for any loss or damages suffered through any act or omission taken as a result of reading or interpreting any of the above information.